The enterprise tax technology market in UK & Europe zone is still developing at a good pace – there are now a number of distinct and mature software product areas where technology handles the various tax domains (tax provision, VAT, corporate tax) and the long term efforts to fully marry up an ERP /SAP system and tax are continuing with high promise.
It is always intriguing to consider how the supply and demand dynamic of technology moves and changes over time, and how this impacts on how the tax technology landscape looks. For example, back in 2008-2009, some high level systems were being developed to automate the tax provisions domain and incorporate the IFRS accounting rules for UK / Europe. However at this time there was very little demand, and selling these solutions was a tough call. Of course, the deep recession of the 2008-2011 period did not help this situation.
Fast forward to 2014, I feel that the supply/demand relationship is quite different. Enterprise tax solutions such as those for tax provision and indirect tax engines are being acquired more regularly by large corporations, but now there seems to be additional demand for more data management and analytics systems to augment the tax technology capabilities. This seems to be mainly stemming from the worldwide tax authorities requiring more disclosures on corporate taxes from entities around the world. The other area is transfer pricing, and whether technology can latch more fully onto that function and enable more clarity on information.
So maybe now a situation of technology supply catching up with demand? It seems that suppliers are working hard to develop and market solutions to meet this demand.
The other segment of the market where technology may act as a differentiator is in the outsourced global tax compliance area, being provided by Big Four firms and other tax consultancies. This service is now viewed as common place, but it will be how these firms adopt technology to extract tax data and use within the tax returns process that will make the difference.
So where are we seeing demand for people to help propel further the tax technology capabilities and services? Generally speaking, from all pockets of the market. The Big Four continue to hire people from a tax compliance background, but with additional strong skills and knowledge base around IT / Excel and tax software applications. As these tax technology consulting teams become more mature, the challenge is finding more junior level hires (i.e. below Manager level) to form more of a pyramid shape team, whereas up until now these teams have been heavier at the senior end.
Demand for people also remains high in the indirect tax technology space, both on the consulting side and software vendor side. This area of the market has grown up a lot in the last 5 years, and in which a tax technology specialist can very much see their career blossom if they go deep into it. This is also the area where we see the most opportunity to take the experience and skills ‘in-house’ into commerce / industry, where full blown tax technology roles are more rare.
One other area where Talentpool is now more active is in the expatriate tax / employee mobility field, where technology has also been well developed and leveraged to better improve the end-user experience.
In summary, the tax technology market in the UK and Europe is developing with strong momentum, although still requiring more specialist ‘foot soldiers’ to enhance the technology and deliver it to the end customer.
For anyone with a corporate / commercial tax background seeking an entry into the tax technology market, please contact Simon Godley for a confidential career discussion.